Takeaway: Following the Fed's December rate hike, Long Bonds (our favorite macro call) rallied to up 12% year-to-date versus 2.6% for the S&P 500.

Remember The Fed's December Rate Hike? What Happened Again? - Hawk dove cartoon 06.06.2016

As the Fed flounders from rate hike rhetoric to cautious soothsaying, Treasuries have rallied. Take a look at the flattening of the yield curve since the Fed decided to "raise interest rates" in December 2015. The yellow line is the yield curve on 12/15/15 and today's is the green line.

Rate hike ... What rate hike?

Click image to enlarge.

Remember The Fed's December Rate Hike? What Happened Again? - rate hike yield spread

To be clear, long the Long Bond (TLT) has been our most vocal Macro call. 

Heading into this year, it was a massively contrarian and in direct opposition to Wall Street consensus, which remained convinced the 10yr Treasury yield would hit 2.5% to 3% on Fed rate hikes. 

Guess what? Our Long Bond call...

IT'S WORKING

The flattening of the yield curve has paid off massively for investors in TLT. Below are the year-to-date returns on Long Bonds versus the S&P 500.

Remember The Fed's December Rate Hike? What Happened Again? - long bonds vs s p